U.S. Weekly Jobless Claims Unexpectedly Drop To 350,000

First-time claims for U.S. unemployment benefits showed an unexpected decrease in the week ended December 22nd, according to a report released by the Labor Department on Thursday.

The report said initial jobless claims fell to 350,000, a decrease of 12,000 from the previous week's revised figure of 362,000.

The drop came as a surprise to economists, who had expected jobless claims to edge up to 365,000 from the 361,000 originally reported for the previous week.

While the unexpected drop is an upbeat sign for the job market, the Labor Department noted that it had to estimate the number of claims from 19 states due to the holidays.

At the same time, the Labor Department said the less volatile four-week moving average fell to 356,750 from the previous week's revised average of 368,000.

Continuing claims, a reading on the number of people receiving ongoing unemployment assistance, also fell to 3.206 million in the week ended December 15th from the preceding week's revised level of 3.238 million.

The four-week moving average of continuing claims dropped to 3,219,000 from the preceding week's revised average of 3,243,750.

Next Friday, the Labor Department is scheduled to release its closely watched monthly employment report for the month of December.

The Labor Department said non-farm payroll employment increased by 146,000 jobs in November compared to economist estimates for an increase of about 85,000 jobs.

However, the report also showed a notable downward revision to the pace of job growth in the two previous months.

While the Labor Department also said the unemployment rate fell to a nearly four-year low of 7.7 percent, the drop reflected a decrease in the size of the labor force as some unemployed people gave up looking for work.